Obama, Republicans Ransack Reagan’s Record, Come Up Empty

April 24 (Bloomberg) -- President Barack Obama hasn’t had
much luck in getting living Republicans to endorse his proposed
“Buffett rule,” which would ensure that the highest earners pay
a minimum federal tax rate of 30 percent.

To find a Republican supporter he has had to raid Ronald
Reagan’s tomb. In a speech on April 11, Obama noted that Reagan,
as president, had sought to prevent multimillionaires from
paying lower tax rates than bus drivers.

Obama continued: “He thought that, in America, the
wealthiest should pay their fair share, and he said so. I know
that position might disqualify him from the Republican primaries
these days but what Ronald Reagan was calling for then is the
same thing that we’re calling for now.”

Not so fast, said Republicans. The Buffett rule would
impose a new minimum tax on affluent people who receive a large
share of their income in capital gains and dividends, which are
taxed below the regular rates on income. The effect would be to
raise their taxes. Reagan, on the other hand, favored cutting
tax rates for everyone, including the wealthiest. His initial
tax-reform proposal cut the very capital-gains tax rates that
the Buffett rule would effectively raise. Reagan wanted to
simplify taxes, whereas the Buffett rule would add an additional
layer of complexity.

Ransacking Reagan’s Record

The wrangling over Reagan’s legacy is evidence of his
rising historical reputation. Liberals who reviled him in the
1980s have shifted to giving him grudging (and occasionally
ungrudging) respect. But while politicians in both parties offer
him praise, they also ransack his record for their present-day
purposes.

Obama is a serial offender. During last year’s debate over
the debt ceiling, Obama praised Reagan for his willingness to
raise taxes in 1982 and criticized today’s Republicans for their
unwillingness to follow suit. Last week, Representative Steny
Hoyer of Maryland, the second-ranking Democrat in the House,
said Reagan “would not have felt comfortable in my opinion in
the Republican conference” because of its rigidity on taxes.

But Obama and Hoyer leave out two facts. Reagan refused to
raise tax rates, as Democrats wanted then no less than now;
instead he raised excise taxes and reduced loopholes. And Reagan
in his memoirs concluded that even this limited increase had
been a mistake, since congressional Democrats hadn’t come
through with spending cuts.

Conservatives make different errors in thinking about
Reagan. It is fine for Republicans to seek to learn from the
example of their most successful president of the past 50 (and
arguably the past 100) years -- so long as they draw the right
lessons. Steven F. Hayward, the author of “The Age of Reagan,”
argues that too many of Reagan’s political heirs have fallen for
a myth that Reagan promoted. “Reagan made it look easy,” he
says. “That was deliberate on his part.”

Reagan believed that one reason his immediate predecessors
were perceived as failures was that they conveyed a sense of
being overwhelmed by the presidency. Only with time has it
become clear how much “real discipline, hard work and focus”
Reagan kept hidden.

This misimpression about Reagan, says Hayward, leads
conservatives to underemphasize the importance of all this hard
work -- both in drafting policies and honing rhetoric -- and to
think that good gut instincts are a substitute for it. “They
don’t have the whole Reagan: Where’s the rest of him?” Hayward
points to Sarah Palin as an example of this tendency.

Conservatism Calcified

Conservatives have also mistaken adherence to Reagan’s
principles with the repetition of his program. Reagan’s agenda
in 1981 applied a conservative philosophy to the challenges of
the moment. To combat Soviet adventurism he initiated a defense
buildup, engaged in ideological warfare and aided proxies
overseas. To control inflation, he supported a painful
tightening by the Federal Reserve. To spur growth, he cut tax
rates.

Circumstances have changed since 1981, in large part
because of the success of Reagan’s program. In some respects
conservatism has adapted to new conditions. Entitlements have
become a much larger share of the federal budget, and
conservatives have accordingly made controlling them a much
higher priority.

But in other respects conservatism has calcified. The top
tax rate is now 35 percent, not 70 percent. Yet many
conservatives act as though the current tax rate is just as much
an impediment to growth as the old one, and consider its further
reduction just as high a priority as it was then. The inflation
rate has been trending downward since 1980, but most
conservatives are more convinced than ever that money is
dangerously loose.

Conservatives aren’t wrong to want to ensure that
incentives to work and invest are robust, or to favor a
predictable, rules-based monetary policy. But these principles
have to be applied to the circumstances in which we find
ourselves, not the ones of 1981.

Compared to the various mythical Reagans on offer, the real
Reagan is less convenient for today’s Democrats -- and a more
challenging example for Republicans.

(Ramesh Ponnuru is a Bloomberg View columnist and a senior
editor at National Review. The opinions expressed are his own.)

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